Deutsche Annington Immobilien SE / Key word(s): Half Year Results/IPO 09.08.2013 / 06:56
Deutsche Annington Immobilien SE increases operating result in the first half-year 2013
FFO 1 increased by 35.3% to EUR 103.4 million compared with the prior-year period
Monthly in-place rents increased by 2.1% and vacancy rate reduced by 0.6% in a year-on-year comparison
EPRA net asset value (NAV) rises by 26.4% to EUR 4,358.8 million in the first half of the year
Operating result (EBITDA) increased by 1.8% to EUR 241.7 million compared with the prior-year period
Investments in maintenance in the first half of the year slightly above the prior-year level
Implementation of the investment programme for energy-saving modernisation and senior-friendly housing amounting to a total of EUR 800 million as planned
22,000 housing units provided with fibre-optic technology
Work performed by the company's own craftsmen's organisation tripled in a year-on-year comparison
Investment grade rating ('BBB') from Standard & Poor's
Placement of corporate bonds worth EUR 1.3 billion
FFO 1 between EUR 210 and EUR 220 million
Increase in rents of between 1.8 and 2%
Dividend of 70% of FFO 1 planned for the year
Bochum, August 9, 2013 - Deutsche Annington Immobilien SE ('DA'), Germany's largest private-sector residential real estate company in terms of portfolio value and the number of units owned looks back on a positive development of business after the first half of 2013. The successful first six months were driven by higher rental income, a lower vacancy rate and overall more efficient property management thanks to a consequent insourcing strategy.
Compared with the first half of 2012, the vacancy rate in the entire portfolio was reduced by 0.6 percentage points to 3.9%, in the rental segment portfolio by 0.4 percentage points to 2.9%. The monthly in-place rent per square meter rose like-for-like, i.e. for all residential units held in the last 12 months, by 2.1% EUR to 5.35/m² in the entire portfolio, in the rental only sub-portfolio by 2.3% to EUR 5.46/m². Adjusted EBITDA rose by 1.8% to EUR 241.7 million despite significant sales of apartments. Sales in the Privatise portfolio segment increased slightly compared with the prior-year period from 1,363 to 1,457 apartments. Sales in the Non-Core portfolio segment amounted to 1,130 units; this segment is generally characterised by higher volatility of the sales figures. FFO 1 at the end of the first half of 2013 was EUR 103.4 million. This constitutes an increase of 35.3% compared with the prior-year figure of EUR 76.4 million. This significant increase mainly results from lower interest expense owing to the restructuring of the GRAND refinancing and the total capital repayments made in the first half of 2013.
The EPRA net asset value (NAV) was EUR 4,358.8 million on June 30, 2013 representing an increase of 26.4% compared with the start of the reporting period. The loan-to-value (LTV) was 53.2% as of June 30, 2013 and fell further to around 51% after the IPO.
'Our performance in the first half of the year shows that we are on the right track with the strategy we have chosen. With efficient property management, good customer service, a flexible financing structure and high investments in modernisation and maintenance, we want to ensure that, as the leading housing company, we continue to benefit from the stable growth of the attractive German housing market,' says Rolf Buch, CEO of Deutsche Annington Immobilien SE.
Implementation of the investment programmes on track
As in the previous year, Deutsche Annington also invested a substantial amount in its housing stocks in the first six months of this financial year. At roughly EUR 67 million, the maintenance investments alone were even slightly above the prior-year level (EUR 63 million).
The EUR 800 million investment programme announced for energy-efficiency modernisation and the senior-friendly conversion of apartments is now in the implementation phase and will become apparent in the annual financial statements at the end of the year.
Systematic further development of service offering
The introduction of an additional service offering has already been well received by the customers in the first six months. The focus here is mainly on more efficient and effective property management as well as the continuous improvement of customer satisfaction overall. Through regular on-site service hours at all locations, DA has further expanded customer care by its Local Customer Service. At the same time, the development of its own craftsmen's and caretaker organisation was also successfully completed in the first six months. In total, more than 330 own caretakers and some 740 own craftsmen are now present at all DA locations throughout Germany. In terms of the sales of the company's own craftsmen's organisation, the work performed by its own craftsmen has tripled compared with the previous year.
At the end of 2011, Deutsche Annington entered into a strategic partnership with Deutsche Telekom in order to equip its housing stocks throughout Germany with modern fibre-optic technology and provide the tenants with a TV signal through the subsidiary Deutsche Multimedia Service GmbH. By the end of the reporting period, Deutsche Multimedia Service GmbH had provided the first 22,000 units with a TV signal.
Successful IPO enables implementation of innovative financing structure
Furthermore, the first half of the year was marked by the preparations for the IPO: On July 11, 2013, Deutsche Annington was successfully listed on the stock exchange. The share price developed well from the start of trading on the Frankfurt Stock Exchange from the issue price of EUR 16.50 to the initial listing price of EUR 17.10 Euro with a gain of 10% (closing price on July 31, 2013). The IPO has opened up far-reaching strategic options for the company, in particular the implementation of a comprehensive, flexible financing strategy.
This was driven forward on July 17, 2013, with the successful initial placement of two corporate bonds amounting to a total of EUR 1.3 billion. In addition, DA's liabilities from the GRAND securitisation were repaid in full on July 22, 2013. DA now has a BBB investment grade rating and therefore a financing structure unique in the market.
Outlook for 2013
The investments in modernisation and maintenance in this financial year will remain at the level of the previous year of around EUR 211 million. In the years to come, DA will be investing, under its investment programme, some EUR 800 million in the energy-saving modernisation of buildings and the upgrading of apartments, primarily in low-barrier and senior-friendly conversions as well as in high-quality housing in selected rental markets.
If the present conditions remain unchanged in the months to come, the company is expecting, for the year as a whole, growth in rental income of between 1.8 and 2.0%, an improvement in the EBITDA margin of 1% compared with the previous year and a FFO 1 of between EUR 210 and 220 million (2012: EUR 162 million). Deutsche Annington intends to pay out a dividend of 70% of FFO 1 assuming business conditions remain stable during the rest of the year.
The complete interim financial report for the first half of 2013 is available from today to read and download at www.deutsche-annington.com.
About Deutsche Annington Deutsche Annington is Germany's largest private-sector residential real estate company both in terms of portfolio value and the number of units owned. As at June 30, 2013, Deutsche Annington owned roughly 179,000 residential units worth a total of EUR 10.4 billion. The company is represented throughout Germany; most of its portfolio is located in the old West Germany and Berlin. Deutsche Annington has its headquarters in Bochum and employs some 2,400 people.
Additional information: Stock exchange: Regulated market / Prime Standard, Frankfurt Stock Exchange ISIN: DE000A1ML7J1 WKN: A1ML7J Common code: 094567408 Registered office of Deutsche Annington: Vogelsanger Weg 80, 40472 Düsseldorf, Germany Business address of Deutsche Annington: Philippstrasse 3, 44803 Bochum, Germany
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